A company needs structure and processes if it wants to become an environment in which people want to work productively. When a company grows from 2 people to maybe 7, you have to start thinking about management structures, processes and first rules that everybody needs to apply.
When a company grows beyond 7, these problems starts to become more and more complex. You need more structures and more rules. BUT! How can you manage the growth of a company without using old traditional models?
Ed Cutmull [1] wrote, that it is the job of a manager to make sure that the organization will survive in case of failures. So, there is the notion of stability in being a manager.
E.g. a friend of mine, Boris, has a small company and he started last year in autumn with these kind of questions:
What is the best structure for his small company? What is his position and his role within his company? Given the fact that he is doing the work as a job, and running a company as a manager. I am 100% sure we will see a lot of change in his small company over the next months. [tbc]
Interesting thoughts on initial scaling. I would keep in mind that the reason a start up company gets off the ground is because of leadership (not management). Then at around 7 people the leader that initiated the company finds that they need to manage as well as lead. There is a transition and this is a crux change. To continue to lead but also introduce the aspects of management that provide stability but not lose the adaptability of leadership.
John Kotter on Leadership vs Management
Management: Planning & budgeting, Organizing & staffing, Controlling & problem solving
Leadership: Establishing direction, Aligning people, Motivation & inspiring
Both (leadership & management) are required but in differing amounts as the scaling of a group of people intent on the same purpose grows. Can the one leader balance the two roles? Some times – some times not – some times the leader learns to balance management (Steve Jobs may be an example – from Apple Computer -> Next -> Pixar -> back to Apple).
Hi David, thanks for this super comment. A completely different opinion than the one, we got from the american leadership literature, we see in the work of the St. Gallen, Professor Malik [1]. His idea ist that leadership is one function of management. In other words a managers job is, besides others also to lead.
If we define that management is the creation and definition of roles, guidelines, goals and other important things to manage a company, than leadership is the skill to guide people to conform, establish, work, and fulfilling these roles.
[1] http://www.malik-mzsg.ch/
More to the question – what is the best structure for the small company to grow into? I’d suggest the lattice management style of W L Gore (Gore-Tex fame) fits the innovative culture of an Agile knowledge company.
http://www.answers.com/topic/w-l-gore-associates-inc
http://ericbrown.com/participative-management.htm
In addition to Gore, there is Ricardo Semler of Semco.
Leading by Omission – talk at MIT
http://mitworld.mit.edu/video/308/
If I were starting a company today – I would model on these two leadership styles. Who knows it might just work. As Ricardo points out – the typical pyramid structure for companies is bound to fail 90% of the time (success rate for companies lasting 5+ years).
Scrum 4 You — Mr. M on bor!sgloger | Managers job! // Feb 5, 2010 at 6:52 pm
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